ESG round-up: Aussie super funds investigated for greenwashing

The latest developments in sustainable finance: Call for mandatory biodiversity disclosures; BNY Mellon says $100tn needed for net zero goal.

Australian financial regulator ASIC has said that super funds in the country are among those it is currently investigating over potential greenwashing. In a release issued today, ASIC’s deputy chair Sarah Court was quoted as saying: “ASIC is currently investigating a number of listed entities, super funds and managed funds in relation to their green credentials claims.” The announcement comes as the regulator revealed that it had taken action against energy firm Tlou over concerns it had about “alleged false or misleading sustainability-related statements” made to the Australian Securities Exchange (ASX) last year.

More than 330 businesses and financial institutions, with $1.5 trillion in combined assets, have signed a joint nature disclosure statement. The signatories – which include BNP Paribas and Aviva Investors – have urged governments to adopt mandatory biodiversity assessment and disclosure for businesses by 2030. The letter encourages world leaders to adopt the Global Biodiversity Framework at the upcoming conference as part of the drive to achieve net zero and the SDGs.

Research produced by BNY Mellon Investment Management has found that $100 trillion in investment is required to reach net zero by 2050. According to the report, the global economy is significantly behind schedule to achieve 2050 net-zero goals and that $100 trillion of “green” investment – around 15 percent of total global investment for the next 30 years – will be needed to bridge the gap. The research also says that the energy and utilities sectors are most in need of capital to decarbonise as they face the biggest climate transition challenges.

The Chicago Public School Teachers’ Pension and Retirement Fund has announced plans to divest from fossil fuels by the end of 2027. The retirement fund, which has $11.5 billion in assets, will seek to engage with fossil fuel companies in their transition to renewable energy. In June, the pension fund held 4.5 percent of its total assets in coal, oil and gas-related investments.

The Pension Insurance Corporation (PIC) has invested an additional £40 million ($46 million; €46 million) in secured debt issued by mhs homes, a social housing provider based in Kent. The capital will fund more than 600 new properties, which will add to the existing 9,500 houses managed by mhs homes. In 2016, PIC made its first £40 million investment in mhs to address the housing crisis by building 400 homes. Two further transactions of £50 million ($58 million; €58 million) were made in 2017 and 2021.

The Business and Human Rights Resource Centre has launched an investor guide warning of the need to put human rights considerations at the core of the energy transition. The NGO is concerned that human rights issues will be overshadowed during COP27 discussions by the need to address energy security. The research found that one of the most serious and frequent human rights issues in the renewables sector is the failure to respect the right to Free, Prior and Informed Consent of indigenous peoples.

The Good Food Finance Network’s High Ambition Group has published targets to support the sustainable food transition. The UN-backed group is comprised of 11 finance firms, including Rabobank, Nuveen Natural Capital, FIRA and Phatisa. Farms and businesses with $113 billion in total assets will be asked to help meet goals relating to zero deforestation, carbon removal and gender equality. Targets include helping 15 million farmers in developing countries transition to agroforestry and reaching zero deforestation across an entire portfolio. The UN Environment Programme supports these goals and has called on the wider finance sector to be more ambitious with food and agriculture targets ahead of COP27.

Proxy advisory firm Glass Lewis has launched an SaaS engagement management platform for investors to coordinate engagement data and manage stewardship programmes more efficiently. The software, powered by Esgaia, will centralise active ownership engagement and proxy voting data to aid investors in managing and meeting ESG goals across their portfolios. It will record outcome-driven engagements, track progress towards goals, centralise engagement admin, and link proxy voting to consolidate reporting efforts.